Stopping Projects

There are always situations in which projects have to be stopped. Below are nine reasons for stopping:

• Final achievement of the objectives

• Poor initial planning and market prognosis

• A better alternative is found

• A change in the company interest and strategy

• Allocated time is exceeded

• Budgeted costs are exceeded

• Key people leave the organization

• Personal whims of management

• Problem too complex for the resources available

Today most of the reasons why projects are not completed on time and within cost are behavioral rather than quantitative considerations. They include:

• Poor human relations

• Poor labor productivity

• No commitment by those involved in the project

The last item appears to be the cause of the first three items in many situations.

Once the reasons for cancellation are defined, the next problem concerns how to stop the project. Some of the ways are:

• Orderly planned termination

• The "hatchet" (withdrawal of funds and removal of personnel)

• Reassignment of people to higher priority

• Redirection of efforts toward different objectives

• Burying it or letting it die on the vine (i.e., not taking any official action) There are three major problem areas to be considered in stopping projects:

• Worker morale

• Reassignment of personnel

• Adequate documentation and wrap-up

Sometimes executives do not realize the relationship between projects and what happens if one is canceled prematurely. As an example, the following remarks were made by an executive concerning data processing operations:

When 75 -80 percent of the resource commitment is obtained, there is the point of no return and the benefits to be obtained from the project are anticipated. However, project costs, once forecast, are seldom adjusted during the project life cycle. Adjustments, when made, are normally to increase costs prior to or during conversion. Increases in cost are always in small increments and usually occur when the corporation is "committed," i.e., 75-80 percent of the actual costs are expended; however, total actual costs are not known until the project is over.

Projects can and sometimes should be canceled at any point in the project life cycle. Projects are seldom canceled because costs exceed forecasts. More often, resources are drained from successful projects. The result of the action is the corporation as a whole becomes marginally successful in bringing all identified projects on line. One might assume individual projects can be analyzed to determine which projects are successful and which are unsuccessful. However, the corporate movement of resources makes the determination difficult without elaborate computer systems. For example, as project A appears to be successful, resources are diverted to less successful project B. The costs associated with project A increase dramatically as all remaining activities become critical to project A completion. Increasing costs for project A are associated with overtime, traveling, etc. Costs for project B are increasing at a straight time rate and more activities are being accomplished because more manpower can be expended. Often resources, particularly manpower working on project B, are charged to project A because the money is in the budget for project A. The net result is projects A and B overrun authorized budgets by about the same percentage. In the eyes of top corporate management, neither project team has done well nor have the teams performed poorly. This mediocrity in performance is often the goal of corporate project management technique.

Project Management Made Easy

Project Management Made Easy

What you need to know about… Project Management Made Easy! Project management consists of more than just a large building project and can encompass small projects as well. No matter what the size of your project, you need to have some sort of project management. How you manage your project has everything to do with its outcome.

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